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Page 2: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant
Page 3: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

Growth Constant Currency Statutory

Revenue 4.7% 4.1%

EBITDA 4.9%* 3.6%

Net profit 7.1% 6.0%

Earnings per share 5.5% 4.5%

Constant currency = FY ‘13 results restated

using FY ‘12 currency exchange rates

* 4.5% EBITDA growth after expensing $2.5 million implementation costs of US cost-out initiative

Page 4: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

‣ Dividend franked to 45%

‣ Record Date 4 September 2013

‣ Payment Date 24 September 2013

‣ Dividend Reinvestment Plan suspended

FY ‘13 FY ‘12 Growth

Interim Dividend $0.25 $0.24 4%

Final Dividend $0.37 $0.35 6%

TOTAL Dividend $0.62 $0.59 5%

Page 5: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

‣ Gearing ratio = Net debt / Net debt + equity (bank covenant limit <55%)

‣ Interest cover = EBITA / Net interest expense (bank covenant limit >3.25)

‣ Debt cover = Net debt / EBITDA (bank covenant limit <3.5)

‣ Formulas as per bank facility definitions

30 June ‘13 30 June ‘12

Net interest-bearing debt A$M 1,739 1,571

Gearing ratio % 37.3 37.6

Interest cover X 8.6 7.0

Debt cover X 2.4 2.5

‣ Available headroom >$400 million post Labco acquisition

‣ Increased net debt due to weaker AUD

Page 6: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

‣ EBITDA growth of approximately 5%

‣ Guidance based on constant currency rates (FY ‘13 FX rates)

‣ Equates to approximately 11% growth at current exchange rates

‣ Includes estimated impacts of possible FY ’14 fee adjustments in Australia,

Germany, Belgium and the USA

‣ Excludes Labco and future acquisitions

‣ Interest and tax guidance

‣ Interest expense to decrease ~10% (constant currency)

‣ Effective tax rate FY ’14 expected to be ~25%

‣ Results tracking in line with guidance after 4 months of FY ’14

‣ Cost-out programs on track

‣ USA: ongoing positive organic volume growth

Page 7: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

Shareholder Update

Page 8: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

‣ Unconventional story

‣ Customised corporate philosophy

‣ Unusual corporate structure

‣ From small lab in Top Ryde, Sydney…

‣ …to annual revenues of $3.5 billion

‣ …employing 26,000 people

‣ …in 3 continents

‣ …market leader in Australia and Germany

‣ …No. 3 player in the USA

‣ Top 50 ASX company

‣ Market cap ~$6.5 billion

Page 9: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

Pathology

78%

Radiology

12%

IPN

10%

Page 10: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

‣ Established in 1987 ‣ Sonic acquires Douglass Laboratories (revenues A$13 million p.a.)

‣ Pathology market fragmented, cottage industry

‣ 1992-1993 ‣ Takeover offer for Sonic (at $0.15 per share)

‣ New majority owner, new Board, new management

‣ 1994-1998 ‣ Series of acquisitions in NSW, SA and ACT

‣ Formation of Douglass Hanly Moir Pathology

‣ 1999 ‣ Turning point for company

‣ SGS Group acquisition

‣ Sonic becomes largest pathology company in Australia

‣ Revenue from ~$175 million to ~$475 million p.a.

Page 11: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

‣ Established in 1987 ‣ Single pathology lab in Sydney (Douglass Laboratories)

‣ Pathology market fragmented

‣ 1992-1993 ‣ Takeover offer for Sonic @ $0.15 per share

‣ New majority owner, new Board, new management

‣ Appointment of (unsuspecting) pathologist as CEO of Sonic!

‣ Why a pathologist? ‣ Pathology is the backbone of medicine

‣ Customers are doctors: GPs and specialists

‣ Key staff: Pathologists and lab scientists

‣ Success in pathology ‣ Resonance with customers to drive revenue

‣ Resonance with key staff to drive quality, efficiency and productivity

‣ Medical Leadership model: Keeping the business “medical”

Page 12: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

Australian Pathology

31%

• FY’13 revenue A$1,067 million

• 9,200 employed staff

Page 13: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant
Page 14: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant
Page 15: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

‣ Consensus and unity achieved

‣ Business model

‣ Corporate structure

‣ Business philosophy

‣ Outcomes

‣ Core Values

‣ Medical Leadership

‣ Federated structure

The Sonic Difference

SonicConnect

A dedicated Sonic department

To connect Sonic’s people globally

To promote The Sonic Difference

Page 16: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant
Page 17: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant
Page 18: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

SYNERGIES

• Procurement

• Benchmarking

• IT

• E-Health

• Shared marketing

• Quality Systems

• Leadership Training

• Centralisation

• Lab design / workflow

• Collegiate interaction

• Shared culture & values

Major brand names retained

Local management autonomy

Local ‘flavour’ preserved

Staff morale enhanced

Revenue fallout minimised

Synergy capture facilitated

Clinpath

Clinipath

DHM

S.IML

Capital

DSPL

SNP

MP Sonic

Page 19: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

Soni

c

Page 20: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

Epworth Radiology

. Sonic

Imaging 12%

FY’13 revenue A$404 million

2,300 employed staff

Page 21: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

‣ Sonic’s position in Australian pathology ‣ Market leader

‣ ~35% market share

‣ Further acquisitional growth limited

‣ Proven, successful model ‣ Core Values

‣ Medical Leadership

‣ Federated management structure

‣ Analysis of off-shore pathology markets ‣ Would the Sonic model succeed in overseas markets?

‣ Why do Australian companies fail in overseas markets?

‣ Strict criteria used to determine country suitability and risks

‣ UK, Germany, USA identified as suitable opportunities for Sonic

Page 22: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

‣ 2002 – UK

‣ 2004 – Germany

‣ 2005 – USA

‣ 2007 – Switzerland

‣ 2010 – Belgium, Ireland

Page 23: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant
Page 24: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

IPN - Medical centres and occupational

health services in Australia

Australia $1,067 31%

USA $749 21%

Germany $565 16%

UK & Ireland $148 4%

Belgium $98 3%

Switzerland $77 2%

New Zealand $41 1% Imaging

$404 12%

IPN $332

10%

Statutory revenue in A$ million

Page 25: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

Australia Germany USA

Page 26: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

USA 21%

• FY’13 revenue A$749 million

• 6,000 employed staff

• Head Office: Austin, Texas

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V

Alabama

Arizona Arkansas

California Colorado

CT

Florida

Georgia

Idaho

Illinois Indiana

Iowa

Kansas

Kentucky

Louisiana

Maine

Mass.

Michigan

Minnesota

Miss.

Missouri

Montana

Nebraska Nevada

NH

NJ

New Mexico

New York

N. Carolina

North Dakota

Ohio

Oklahoma

Oregon

Pennsylvania

S. Carolina

South Dakota

Tennessee

Texas

Utah

Virginia

Washington

W. Va.

Wisconsin

Wyoming

Hawaii

Hawaii

Page 28: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

Germany 16%

• FY’13 revenue A$565 million

• 4,000 employed staff

• Head Office: Berlin

Sonic Healthcare Germany

Laboratory locations

Page 29: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

‣ ~

Labco HQ

Giessen

Duisburg

Saarbrücken

Karlsruhe

Dillenburg

Sonic laboratory sites

Labco sites

Page 30: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant
Page 31: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant
Page 32: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant
Page 33: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

Customisation of

services

Lab-clinician

relationships

High quality reports

E-products

Value-added services

Customer service

Sonic Core Values

Care for our people

Staff feeling valued

Long service

Workplace safety

Employer of choice

Promote culture

Accuracy

Turnaround times

Technical excellence

Innovation

In-house IT solutions

Modern systems

Modern equipment

Modern facilities

Experts in field

Leaders in field

Centres of

excellence

Environment

Community care

Charities

Corporate Citizen

HEAL Africa

Environment

Community

care

Charities

Corporate

Citizen

HEAL Africa

Clinpath

Clinipath

DHM

S.IML

Capital

DSPL

SNP

MP Soni

c

Page 34: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant
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“One of the most underprivileged areas in the world”

Page 36: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant
Page 37: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant
Page 38: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant
Page 39: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant
Page 40: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

Page 41: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

Building on our solid foundation…

For future success

Page 42: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

-

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3,500

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cents

-

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A$ cents

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Best

Service

Financial

Drivers

Passion

Respect for staff

Empathy with staff

Maintain medical focus

Focus on quality

Management integrity

Ethical practice

Culture

Values

Page 45: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

‣ Pathology integral to healthcare system

‣ 70% of all medical diagnoses depend on pathology

‣ 100% of cancer diagnoses depend on pathology

‣ Strong underlying growth drivers

‣ Ageing of population

‣ New tests

‣ Genetic testing

‣ Preventative medicine – front end vs back end

‣ Funding

‣ Some fee cuts to curb growth

‣ Australia – industry growth cap

‣ USA – cuts to Medicare/Medicaid (~20% of Sonic’s US revenue)

‣ Germany – one-off caps imposed on statutory insurance revenue

(~50% of Sonic’s German revenue)

Page 46: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

Page 47: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

‣ Staff first

‣ Preservation of strong culture and values

‣ Pursuit of quality, service and good medicine

‣ Our business is a force for good:

‣ We see millions of patients each year

‣ We perform millions of tests/examinations each year

‣ Our work is the backbone of the healthcare system

‣ We prevent, diagnose and monitor disease

‣ We improve the health of communities we serve

Page 49: Growth Constant Currency Statutory · 2017-05-04 · Growth Constant Currency Statutory Revenue 4.7% 4.1% EBITDA 4.9%* 3.6% Net profit 7.1% 6.0% Earnings per share 5.5% 4.5% Constant

Sonic Healthcare Limited

2013 Annual General Meeting

Proxy Results

RESOLUTION FOR AGAINST OPEN OPEN TO

CHAIR ABSTAIN

1 Ms Kate Spargo

Re-election as Director 237,977,532 10,553,689 20,846,294 20,295,460 724,811

2 Dr Jane Wilson

Re-election as Director 240,550,603 8,388,624 20,852,889 20,297,455 310,210

3 Dr Philip Dubois

Re-election as Director 151,747,689 97,180,405 20,858,471 20,295,112 315,761

4 Adoption of Remuneration

Report 237,208,773 9,652,542 20,827,175 20,288,063 1,949,765